Indian Stock Market Extends Rally as Sensex Surges 500 Points, Nifty 50 Reclaims 24,200
Indian Stock Market Sees Healthy Gains on Hopes of US-Iran War Ending
The Indian stock market rebounded on Tuesday, March 10, after two consecutive sessions of losses that saw the Sensex and the Nifty 50 decline by 3% each. The market's gain was triggered by U.S. President Donald Trump's hint that the war in West Asia could be nearing an end.
Market Performance
The Sensex jumped by 950 points to an intraday high of 78,526.25, while the Nifty 50 climbed by 1% to the day's high of 24,303.80. However, the indices pared gains quickly, with the Sensex rising by 507 points (0.65%) to 78,073, and the Nifty 50 gaining by 173 points (0.72%) to 24,201 by 10:20 am.
Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data
Market Capitalization
Investors earned ₹4 lakh crore within minutes as the overall market capitalization of BSE-listed firms rose to ₹445 lakh crore from ₹441 lakh crore in the previous session.
Key Factors Driving the Market
- Hopes of an End to the US-Iran War: The US and Israel's combined attack on Iran on February 28 has sparked hopes of an end to the conflict. US President Donald Trump predicted that the "conflict may end well before the initial four-week time frame laid out by him earlier."
- Crude Oil Prices Ease: Crude oil prices declined by 6% to $99 per barrel after Trump signalled that the end of the US-Iran war could be imminent. The G7 group of countries also announced that they are ready to take "necessary measures" to support global energy supply.
- Rupee Rebounds: The Indian rupee rebounded by 23 paise to 91.98 against the US dollar in early trade on Tuesday.
- Value Buying in Major Sectors: Major indices, such as Nifty Bank, Financial Services, Auto, and Pharma, jumped by over 1% each in morning trade on Tuesday due to value buying in quality stocks from these segments.
- US Dollar and Bond Yields Decline: The dollar index declined by half a per cent, and the benchmark 10-year US bond yield eased to near 4% from 4.2% in the previous session, indicating that investors' rush to safety had subsided and risk appetite had improved.
Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline
Investor Takeaway
Investors should be cautious of the market's volatility and potential for quick gains.
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